Settlement Allows Kansas Utility Company to Pass $366 Million on to Customers

Kansas Gas Service customers will pay an estimated $5 to $7 a month for five to 10 years to pay for a spike in natural gas costs during frigid weather last year.

The Kansas Corporation Commission approved a settlement Tuesday that will allow the utility company to pass on $366 million in extra natural gas costs to its 640,000 natural gas customers, The Wichita Eagle reported.

The exact cost per customer will depend on terms Kansas Gas gets for the bonds it will issue to cover the costs from last February, when gas prices increased dramatically in the midst of severe cold.

Customers won’t see the extra costs on their bills for several months.

The agreement includes provisions for refunds if ongoing investigations and lawsuits find market manipulation and price gouging occurred during the freeze emergency.

Before the cold snap last February, gas was selling on the spot market around $3 per million British thermal units. At the height of the freeze, spot-market prices reached $622 for the same amount of gas.

Kansas Gas said in a statement that it was pleased with the settlement.

“We prioritize keeping our customers safe and warm during these extreme weather events and aim to recover the unprecedented costs from the high natural gas prices due to the storm with fairness and minimal impact to customers,” the statement said.